How can I get a Private Investor interested in my business?

If you’re a start-up business looking for investment, chances are you’ll have considered a private investor. However when securing investment in this way you will need to be prepared, as they’ll have a specific set of criteria that you and your business will need to pass before they’ll consider you as an investment opportunity. But how can you make an investor interested in your business? For a few tips, read on.

To get an investor interested, you need to have a sound business plan and an exceptional business idea. The more unique the better, as it’s often the riskiest ideas that pay off the most. Don’t bore them with ideas that have been done too many times or that don’t offer anything new; make sure that your business is a new product or offers a new service, or offers an existing one in a way that’s never been done before.

After a sound business idea, the most important thing to do to appeal to an investor is to make sure that your business has the potential for growth and profit. As you would expect, the potential profitability of a business is key, as profit is the ultimate goal of any entrepreneur.

This is even more so with private investors. They’ll be risking their own money in your business, so they need to believe that their risk will pay off. Most look to see this growth within the first 5 years, and are often looking for a high return in the region of 20-30% per year. If you opt for venture capitalists, they’ll also be looking to secure their return in the form of the eventual sale of the business. Whichever you choose, make sure you portray this potential growth to the investor to get them hooked.

At the same time, you need to be realistic. Don’t show them figures that can’t be backed up with facts and sound business knowledge. They need to know that they can trust you and your business acumen, and if they don’t they won’t be interested.

An investor needs to be offered a nice chunk of the business. Again, it’s their own money, and if they’re not offered a good return they won’t be tempted to invest. Make sure you specify their exit strategy as well, as it’s no point offering them a high return if you’re not showing them how they can get it.

If you follow this advice, you’ll be far more likely to get an investor interested in your business. And if you do that, you have the potential to be more successful than you could ever be on your own.